Anonymous wrote:To 07:26…

Does the 5-year lookback start now with the divorce?

Not that PP but... the 5 year lookback starts with the day you apply for Medicaid.

If you apply today, March 16th 2025, they will go through all your records and bank accounts starting March 16th 2020, to see if you gave any money away since that date.

Any money you spent on anything other than your basic needs will be deemed money you could have spent on nursing home care.

Let's say you and your wife have have 1 million in assets right now. And in 2022 you gave your granddaughter $20,000 to help pay for college. And you, the husband, now need to be in a nursing home which costs $130,000 a year.

You will need to spend (from your assets) $1,000,000 - the $135,000 your spouse gets to keep for herself = $865,000 on nursing home care, plus the $20,000 that you gave to your granddaughter within the 5 year lookback... before Medicaid will pick up the cost of your nursing home care.

I think the "well spouse" can keep some of her own retirement income, like if she has her own pension? And expenses that were necessary to repair the house, or to buy a car, are not considered in the spend down period, unless you do things that are not fair market value.

To 07:26…

Does the 5-year lookback start now with the divorce?

my 8o year old parents are getting divorced now. Mom is in nursing home and dad has $2m in assets. He is paying her a lump sum enough for the 5 year look back period. Some states have spousal refusal (ny) where you can decline to pay for nursing home but even then the estate attorney we spoke to said better to put remaining assets in a trust.

Anonymous wrote:

Anonymous wrote:The legal expectation is that no more than 50% of joint assets in a (intact) marriage needs to be used for care - of the one person.

No need to divorce. Spend-down and document the 50%

You are referring to something called Spousal Impoverishment protection.

https://www.medicaid.gov/medicaid/eligibility/spousal-impoverishment/index.html

The expense of nursing home care — which ranges from $5,000 to $8,000 a month or more — can rapidly deplete the lifetime savings of elderly couples. In 1988, Congress enacted provisions to prevent what has come to be called "spousal impoverishment," leaving the spouse who is still living at home in the community with little or no income or resources. These provisions help ensure that this situation will not occur and that community spouses are able to live out their lives with independence and dignity.

Each state can make its own requirement for how many assets and how much income the "community spouse" can keep for themselves and how much they need to use to pay for nursing home care. But the federal government sets minimum and maximum values states can use.

https://www.medicaid.gov/federal-policy-guidance/downloads/cib11152024.pdf


Community Spouse Resources:
Minimum Resource Standard: $31,584
Maximum Resource Standard $157,920

Home Equity Limits:
Minimum: $730,000
Maximum: $1,097,000


So no, it is not true that the community spouse can keep 50% of their retirement and other assets. They can keep, at most, $157,920 of their retirement assets.

If you have saved $1,000,000 together as a married couple to serve you through retirement - your better bet is to divorce and split that retirement account so the community spouse can keep $500,000 of it for her own retirement needs.

Here are the spousal impoverishment rules in Maryland:

https://www.medicaidplanningassistance.org/medicaid-eligibility-maryland

Treatment of Assets for a Couple
All assets of a married couple are considered jointly owned (regardless of the long-term care Medicaid program for which one or both spouses is applying). Spousal Impoverishment Rules, however, permit the non-applicant spouse of a Nursing Home Medicaid or Waiver applicant a Community Spouse Resource Allowance (CSRA). In 2025, the community spouse (the non-applicant spouse) can retain 50% of the couple’s assets, up to a maximum of $157,920. If the non-applicant’s share of the assets falls under $31,584, 100% of the assets, up to $31,584 can be retained by the non-applicant.


Maryland Medicaid Home Exemption Rules
For home exemption, the Medicaid applicant or their spouse must live in their home. If there is no spouse in the home, there is a home equity interest limit of $730,000 (in 2025). Home equity is the value of the home after subtracting any outstanding debt against it. Equity interest is the amount of home equity owned by the applicant. Furthermore, if neither the applicant nor their spouse live in the home, the applicant must have Intent to Return. Note: For Regular Medicaid, there is no home equity interest limit. Other exemptions exist.

Anonymous wrote:The legal expectation is that no more than 50% of joint assets in a (intact) marriage needs to be used for care - of the one person.

No need to divorce. Spend-down and document the 50%

You are referring to something called Spousal Impoverishment protection.

https://www.medicaid.gov/medicaid/eligibility/spousal-impoverishment/index.html

The expense of nursing home care — which ranges from $5,000 to $8,000 a month or more — can rapidly deplete the lifetime savings of elderly couples. In 1988, Congress enacted provisions to prevent what has come to be called "spousal impoverishment," leaving the spouse who is still living at home in the community with little or no income or resources. These provisions help ensure that this situation will not occur and that community spouses are able to live out their lives with independence and dignity.

Each state can make its own requirement for how many assets and how much income the "community spouse" can keep for themselves and how much they need to use to pay for nursing home care. But the federal government sets minimum and maximum values states can use.

https://www.medicaid.gov/federal-policy-guidance/downloads/cib11152024.pdf


Community Spouse Resources:
Minimum Resource Standard: $31,584
Maximum Resource Standard $157,920

Home Equity Limits:
Minimum: $730,000
Maximum: $1,097,000


So no, it is not true that the community spouse can keep 50% of their retirement and other assets. They can keep, at most, $157,920 of their retirement assets.

If you have saved $1,000,000 together as a married couple to serve you through retirement - your better bet is to divorce and split that retirement account so the community spouse can keep $500,000 of it for her own retirement needs.

Anonymous wrote:

Anonymous wrote:Consult an attorney in the relevant jurisdiction who is affiliated with the National Academy of Elder Law Attorneys (NAELA).

This is tricky stuff. Not for amateurs or dabblers.

This is the best post in this thread.

I don't disagree. But we found it difficult to find someone who specialized in elder care that wasn't in some way . . . less upstanding. Most attorneys specialize, and it's hard to make a living when you specialize in something as specific as elder care. And many we know don't want to get involved in what is a generally traumatic situation within families.

It is best to learn as much as possible before making any decisions.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The legal expectation is that no more than 50% of joint assets in a (intact) marriage needs to be used for care - of the one person.

No need to divorce. Spend-down and document the 50%

I believe it is state based. In some states the community spouse can keep the house, but is only allowed a monthly allowance, which frequently doesn't cover all expenses for upkeep of the house, much less themselves.

In my state, Medicaid will take assets including SSI, and provide the house (up to X value) and allowance only to the spouse.

The community spouse allowance amount is the same across all states even if one applies to their state to receive Medicaid LTC. And the community spouse can remain in the house. IDK what PP means here by "up to X value".

I reread what I wrote and it was not clear at all. In many states Medicaid allows the community spouse to keep up to a million in assets. But when you read the fine print, they will let the spouse keep a house that in many areas could have appreciated up to 1M or more. So really, it isn't a case where the community spouse gets to keep 1M worth of assets, they just get to keep the house if it is worth 1M or less. If they have to sell the house, then the proceeds are then subject to Medicaid.

We looked into this for my mom when we were trying to decide what to do for my dad. They didn't have enough to pay for in-home care, or a nursing home. If Dad went into a Medicaid facility, while my mom could keep the house, the community spouse stipend was not enough to even pay their property taxes, much less her living expenses. They bought the house decades ago when we were kids, but it is in an area that over the years has appreciated wildly.

Basically, there was no good solution for them other than the kids paying for the care out of pocket for in-home for our dad. Once he passed and my mom needed care, we paid for that as well, at-home until she needed even more care. She went to nursing and we sold her home to pay for that.

Anonymous wrote:Consult an attorney in the relevant jurisdiction who is affiliated with the National Academy of Elder Law Attorneys (NAELA).

This is tricky stuff. Not for amateurs or dabblers.

This is the best post in this thread.

Anonymous wrote:

Anonymous wrote:The legal expectation is that no more than 50% of joint assets in a (intact) marriage needs to be used for care - of the one person.

No need to divorce. Spend-down and document the 50%

I believe it is state based. In some states the community spouse can keep the house, but is only allowed a monthly allowance, which frequently doesn't cover all expenses for upkeep of the house, much less themselves.

They are allowed to retain up to X of their assets in addition to the house. The number increases slightly ever year. Ten years ago it was roughly $125K. If they do not have many assets, then that affects what they have to cover their expenses.

And the Medicaid regs are not state based.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The legal expectation is that no more than 50% of joint assets in a (intact) marriage needs to be used for care - of the one person.

No need to divorce. Spend-down and document the 50%

I believe it is state based. In some states the community spouse can keep the house, but is only allowed a monthly allowance, which frequently doesn't cover all expenses for upkeep of the house, much less themselves.

In my state, Medicaid will take assets including SSI, and provide the house (up to X value) and allowance only to the spouse.

The community spouse allowance amount is the same across all states even if one applies to their state to receive Medicaid LTC. And the community spouse can remain in the house. IDK what PP means here by "up to X value".

Anonymous wrote:

Anonymous wrote:The legal expectation is that no more than 50% of joint assets in a (intact) marriage needs to be used for care - of the one person.

No need to divorce. Spend-down and document the 50%

I believe it is state based. In some states the community spouse can keep the house, but is only allowed a monthly allowance, which frequently doesn't cover all expenses for upkeep of the house, much less themselves.

In my state, Medicaid will take assets including SSI, and provide the house (up to X value) and allowance only to the spouse.

Anonymous wrote:

Anonymous wrote:I would think if you put your assets in a trust controlled by the kids, you could accomplish the same thing.

Of course, you have to be certain the kids will support you.

Only if it's irrevocable.

It would have to have been done more than 5 years before Medicaid is needed. And this might be an instance where they would invoke family responsibility, which is the law in many places, but rarely upheld in the past.

Anonymous wrote:The legal expectation is that no more than 50% of joint assets in a (intact) marriage needs to be used for care - of the one person.

No need to divorce. Spend-down and document the 50%

I believe it is state based. In some states the community spouse can keep the house, but is only allowed a monthly allowance, which frequently doesn't cover all expenses for upkeep of the house, much less themselves.